The Forest-Climate Nexus

The report argues that tropical forests should be central to climate strategies, moving from being viewed as a risk to a solution. It analyzes 91 countries, categorizing them by forest cover and deforestation rates, and concludes that forest protection and restoration are compatible with economic growth. To address the funding gap for restoration, the authors propose the Reversing Deforestation Mechanism (RDM), a jurisdictional, results-based payment system for net carbon removals. RDM is designed to complement existing tools like JREDD+ and the Tropical Forest Forever Facility (TFFF). Simulations suggest that at a carbon price of US$ 50 per ton, RDM could generate significant annual revenues and remove up to 2 GtCO2 per year globally in its early stages.

• Tropical forests across 91 analyzed countries cover 1.27 billion hectares and store 593 gigatons of CO2 equivalent, which is approximately one-third of historical global emissions.
• Restoring areas deforested between 2001 and 2023 has the potential to capture up to 49 GtCO2, a significant amount relative to the remaining carbon budgets for 1.5°C and 2.0°C targets.
• Analysis of 91 countries indicates that deforestation is not a necessary condition for economic growth, as there is no direct relationship between per capita income or GDP growth and forest cover or deforestation rates.
• The report categorizes tropical forest countries into three clusters: those with high cover/low deforestation/low carbon potential; low cover/high deforestation/low carbon potential; and high cover/high deforestation/high carbon potential (notably Brazil, Indonesia, and the DRC).
• The proposed Reversing Deforestation Mechanism (RDM) is a jurisdictional, results-based system that rewards net carbon removals—calculated as carbon captured through restoration minus emissions from deforestation and degradation.
• Simulations indicate that at a carbon price of US$ 50 per ton of CO2, RDM could generate annual revenues of roughly US$ 100 billion and remove about 2 GtCO2 per year globally between 2031 and 2035.
• RDM is intended to complement other mechanisms: JREDD+ focuses on avoided deforestation, and the Tropical Forest Forever Facility (TFFF) rewards the maintenance of standing forests.
• Effective forest policies are highly susceptible to political cycles, with deforestation rates often fluctuating based on electoral incentives and shifts in government priorities.
• Secure land tenure and property rights are critical enabling conditions for forest conservation, with evidence showing that titling indigenous communities significantly reduces forest clearing and degradation.
• To ensure the permanence of carbon sequestration, the report suggests using a Permanence Fund (funded by a small fee per credit) or a Forgivable Loan Structure where funds must be repaid if forests are deforested.

APA

Assunção, J., Arbache, J. P., Chiavari, J., de Miranda, G., & Zangiski, G. (2025). The Forest-Climate Nexus. Climate Policy Initiative. https://www.climatepolicyinitiative.org/wp-content/uploads/2025/10/The-Forest-Climate-Nexus.pdf

Chicago

Assunção, Juliano, João Pedro Arbache, Joana Chiavari, Giovanna de Miranda, and Gabriela Zangiski. The Forest-Climate Nexus. Climate Policy Initiative, 2025. https://www.climatepolicyinitiative.org/wp-content/uploads/2025/10/The-Forest-Climate-Nexus.pdf.

Wikipedia

{{cite report |last1=Assunção |first1=Juliano |last2=Arbache |first2=João Pedro |last3=Chiavari |first3=Joana |last4=de Miranda |first4=Giovanna |last5=Zangiski |first5=Gabriela |title=The Forest-Climate Nexus |publisher=Climate Policy Initiative |date=October 2025 |url=https://www.climatepolicyinitiative.org/wp-content/uploads/2025/10/The-Forest-Climate-Nexus.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{assuno2025forestclimate, author = {Assunção, Juliano and Arbache, João Pedro and Chiavari, Joana and de Miranda, Giovanna and Zangiski, Gabriela}, title = {{The Forest-Climate Nexus}}, institution = {Climate Policy Initiative}, year = {2025}, month = oct, url = {https://www.climatepolicyinitiative.org/wp-content/uploads/2025/10/The-Forest-Climate-Nexus.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }